With their more flexible lending requirements, FHA loans are well-suited for first-time home buyers, particularly because those with lower credit scores may be accepted. On the other hand, conventional loans may be ideal for borrowers with higher credit scores who can also make a larger down payment.
For home buyers, two of the most popular types of home loans are the FHA and conventional mortgages. The following assessment of an FHA loan vs conventional mortgage will allow readers to make the best choice for their needs.
Qualifications. Conventional loans require a FICO of 620 or higher. In addition, you can qualify for FHA loans one year after Chapter 13 bankruptcy, two years after Chapter 7 and three years after a foreclosure. With a conventional mortgage, you may have to wait two to.
Insured by the Federal Housing Administration (FHA), FHA-loans require lower minimum credit scores and down payments than many conventional loans, making them ideal for first-time home buyers and the.